Local News

Low prices leave producers struggling

Ag commissioner says department will work to address livestock diseases

By Marianne Goodland

The Colorado Independentwww.coloradoindependent.com

Posted:
01/23/2016 07:05:30 AM MST

Colorado's agricultural industry brings in $40 billion to the state's economy. But this year low prices — especially in wheat, corn, beef and dairy — will make 2016 a year to be endured and survived for this square state's farmers and ranchers.

Don Brown, a third-generation Yuma farmer who raises cattle and corn, just wrapped up his first full year leading the state's ag department.

Agriculture is good business, because eating is good business, Brown said with a smile. But this year, "We're really struggling, price-wise," which he said will be the biggest challenge for farmers and ranchers.

Don Brown, Colorado Commissioner of Agriculture

When wheat prices are high and stores hike the cost of bread, for example, farmers don't see more than a few cents per loaf. But low wheat prices hit farmers harder, he said. They leave no room for bad luck, such as a hail storm or flood, he said.

This year, the Department plans to help farmers and ranchers by working to keep animal diseases under control. Last summer and fall, vesicular stomatitis rampaged the state's livestock. The VS virus leads to painful oral blisters and sores, and can render animals lame. The department struggled to educate the public about the virus and to mandate quarantines where the virus hit.

At its peak in November, VS was found in horses, cattle and mules in 17 counties and 80 locations, with more than 300 quarantined animals.

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Viruses hit rural economies hard, Brown said, describing how VS cost a Western Slope cattle rancher thousands of dollars. The rancher had to hold off selling his calves until the virus left the herd. Waiting cost him the sale of several hundred calves — roughly $400 per head.

Brown is optimistic the outbreak is just about over.

Paying for workers, water and enforcing expensive rules and regulations will be tough for farmers and ranchers this year, because prices are low. For example, more stringent emission standards force producers to pony up for energy efficient diesel engines. But the market prevents farmers and ranchers from passing along those higher costs to buyers, Brown said. The growers eat the costs, while shoppers reap the rewards.

Brown said his department makes an effort "to influence those who make those rules, whether at the federal or state level ... It's important that we try not to burden anybody."

Producers will need to play a role with Gov. John Hickenlooper's new state water plan, which was rolled out in November, he said. The plan mandates farmers and ranchers conserve 50,000 acre-feet of water. As James Eklund, director of the state's water conservation board recently explained, one-acre foot of water is the amount it would take to cover Mile High Stadium from endzone to endzone with one foot of water.

Brown touted the water plan for recognizing the importance of agriculture and said his department will aim to educate urban Coloradans about water's role in producing food and fiber, which in turn helps keep rural communities alive and farms healthy.

While 80 percent of the state's water runs through agriculture, "we don't consume it," Brown said. Once a field is irrigated, most of the water returns to the ditch, river or aquifer, where it goes to other users, under monitoring from the state for pesticide or fertilizer levels. The water that remains in the field is turned into a crop, Brown said. "We're vastly more efficient with what we use — we raise a lot more crops with the same drop of water. We may not be using less, but we're producing way more."

In 2016, lawmakers will introduce a bill to encourage young people to start farming and ranching. The U.S. Department of Agriculture in 2012 reported the average age of farmers and ranchers in Colorado is 57.

But starting farming isn't easy, Brown said. Farms need to be large to make a profit, and most young people can't afford to begin.

Lawmakers plan to reintroduce a 2015 bill that would give landowners an income tax deduction when they lease agricultural land, crops, livestock or farm equipment to a novice farmer or rancher who wants to join the industry full-time.

"We have to tempt our young people" with a variety of resources including better broadband services, he said. Broadband services allow farmers and ranchers to more quickly obtain important agricultural information, including access to new technologies. "We have to create an environment that's friendly to the young people" who want to either start new farms or take over their families'.

Brown also plans to improve international opportunities for Colorado agriculture. He said the Trans-Pacific Partnership, a 12-nation agreement that will open up new markets for American exports, should be a win for Colorado agriculture, especially Colorado beef, which is hit with high export taxes from Japan, one of the TPP partners. Those export taxes could drop from 38.5 percent to single digits in a few years under TPP, which in turn would result in lower costs for Japanese consumers and more demand for Colorado beef.

A 10-year fight over exporting potatoes to Mexico continues to worry Colorado farmers. The dispute reached its zenith in 2014, when Mexican farmers, wanting to protect their profits, filed a lawsuit to halt U.S. potato exports. The halt on exports lasted only a month and potatoes continue to flow into Mexico, but under severe restrictions while the lawsuit continues to work its way through the Mexican courts. The most notable restriction is that potatoes from the U.S. are only allowed into the country as far as 16 miles south of the U.S.-Mexico border. "We do see increased sales down there, but nothing like it could be," Brown said.

Brown praised Denver voters funding the expansion of the National Western Stock Show complex. It's very important that voters are supporting agriculture, he said. "It's nice to be a cow town again!"

Brown also praised Hickenlooper and his cabinet's support for the state's farmers and ranchers, including the governor's 2016 State of the State speech, which highlighted rural issues.

Agriculture is still a good business to be in, Brown said. "It's a good life."

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